Automating underwriting can increase turnaround time exponentially, moving the needle from weeks or months to mere days.
What do robotics and automation have to do with securing a loan? According to recent developments in tech-driven underwriting, a lot. As the recent pandemic laid bare the painfully inefficient process of underwriting loans, companies and financial organizations are turning to automation to move things along.
Banking during a crisis
As the turnaround time to receive credit takes longer, businesses that desperately need it during a national crisis end up closing doors. This is terrible news for the recovery of the economy when a simple loan could make all the difference. The trouble is the heavy reliance on manual processes makes the situation unsustainable.
Automating underwriting can increase turnaround time exponentially, moving the needle from weeks or months to mere days. This can get much-needed funds into the hands of individuals and businesses who need it without sacrificing the underwriting quality that financial institutions need to remain sustainable.
The complexity of federal loans
There are many federal opportunities for loans, but each option comes with its own set of requirements, data points, methodologies, and paperwork. While training humans for these complexities is time-consuming, artificial intelligence can catch on to the mundane, rote pieces of underwriting, leaving humans to higher-order tasks.
RPA can facilitate the loan process from end to end, removing human error due to factual inaccuracy or simple oversight. Underwriting is the most crucial step in the loan but is prone to error because of the tedium. To combat the glut of data, RPA-powered software pulls in individual information from multiple sources and systems, creating a complete picture of the individual or organization’s loan worthiness.
RPA also helps government organizations respond to inquiries more quickly thanks to natural language processing and the evolution of the chatbot. Since most questions and concerns fall under a limited range of subjects, the bots provide a communication level not possible with human labor.
The value of chatbots was recently proven in another COVID-19-related area. To assist in answering unemployment and COVID-related questions, three-quarters of states in the U.S. have deployed chatbots.
Implementing RPA for sustainable loan processing
Using automation helps reduce human errors, speed time without sacrificing accuracy, and provide valuable communications between loan applicants and loan providers. It’s about to transform the way we think about credit and how we respond to future economic crises.